It is not uncommon for agencies to hire other agencies to do work for them. Unfortunately, sometimes that comes with the lead agency telling the subcontractor that they won’t be paid until the ultimate client pays.
Chip recently wrote about this on LinkedIn and encouraged agencies not to accept these terms because it transfers too much risk and removes the ability of that agency to do any kind of meaningful collections work since they can’t talk to the ultimate payer.
Gini came into the conversation in disagreement because she felt that she shouldn’t be paying out funds until she received them from her client.
Ultimately, Chip and Gini found some common ground to help agencies think about how to navigate this tricky issue.